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This will allow the company to continue export- Petroperu that effectively deals with the legacy
ing crude from its flagship asset, the Bretaña contingent liability and ensures that PetroTal is
field, via Petroperu’s Northern Oil Pipeline substantially protected against future oil price
(ONP), it said. volatility through hedging arrangements.”
The Canadian independent also noted that He continued: “Petroperu’s pipeline and
some of the terms of the oil sales contract had refinery network are important elements of
been revised. Other changes include provisions PetroTal’s ongoing Bretaña oilfield develop-
that give Petroperu 240 days from the date oil ment, and the company embraces the strong
arrives at Pump Station #1 at Saramuro to pay working relationship it has with Petroperu. In
the invoices submitted by PetroTal, taking into addition to the company’s recently announced
account the extended time needed to finalise successful pilot oil export through Brazil, this
export sales. Additionally, the revised contract agreement with Petroperu that ensures future
provides for PetroTal to “continue to have the oil sales into the ONP, along with settlement of
ability to immediately factor future invoices, the contingent liability, significantly enhances
at a nominal rate, and therefore cash flow is PetroTal’s operations.” ™
expected to remain largely unaffected by this
longer invoice period.”
The revisions also lay the groundwork for
price hedging, adjustment of initial differentials
and other measures designed to optimise the
value of the crude oil that PetroTal and Petrop-
eru bring to market via ONP.
Meanwhile, the parties have also signed a
separate agreement resolving the contingent
liability that arose as a result of the dramatic
fall in world oil prices last year. Under this deal,
PetroTal will settle this liability, which concerns
2.4mn barrels of crude worth $16.6mn, on a
one-time basis, with payments to be made over
a period of three years.
The statement also noted that PetroTal and
Petroperu were still working together to estab-
lish an alternative export route for crude from
Bretaña, following the successful conclusion of
the first pilot shipment of 106,000 barrels last
month.
They are now looking to carry out a second
pilot shipment, sending 200,000 barrels of oil via
barge down the Amazon River to Brazil’s Atlan-
tic coast, in February 2021, it noted.
Manuel Pablo Zuniga-Pflucker, the presi-
dent and CEO of PetroTal, said his company
was “pleased to finalise this agreement with The Canadian company exports oil via the ONP system (Image: PetroTal)

ECUADOR
Quito prepares for talks on refinery lease

ECUADOR’S government will soon receive a Rene Ortiz, Ecuador’s Minister of Energy
formal proposal from a US-Korean consortium and Non-Renewable Resources, said last week
for the lease and modernisation of the 110,000 that the upcoming contract negotiations were a
barrel per day (bpd) Esmeraldas oil refinery. sign of an improvement in the country’s invest-
According to press report, the consortium, ment climate. “This marks the return of Amer-
which includes US-based KBR and South ican companies, which were mistreated during
Korea’s Hyundai, is due to present its offer on the previous regime,” he said during an Institute
February 19. The group submitted the only offer of the Americas roundtable discussion.
for the project during a tender held last year. The contract under discussion will allow the
Ecuadorean officials have estimated the value consortium to lease the refinery for 25 years.
of the operatorship and modernisation works at The partners must also install deep conversion
around $3bn. Morgan Stanley is anticipated to technology that will allow the plant to turn out
structure a financing deal for the project. fuels that meet Euro-5 standards. ™

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